Were bidis cigarettes that had to be listed in the Virginia Tobacco Directory, making the retailer's contraband-cigarette penalty valid?

Subject

Court Case: The Juma Brothers, Inc. v. Virginia Department of Taxation

Plain-English summary

The Portsmouth Circuit Court upheld Virginia's tobacco penalty against The Juma Brothers, Inc. The company challenged the Department after bidis it handled were treated as products required to appear in the Virginia Tobacco Directory.

The court found that bidis were cigarettes under Va. Code § 3.2-4200. Because the products at issue were not properly listed, the court treated them as contraband cigarettes under § 3.2-4207 and held that the penalty assessed under § 3.2-4212 was not erroneous.

Result: the petition of appeal was denied, and the company was ordered to pay the assessment plus interest.

Common questions

Is this a Tax Commissioner ruling? No. It is a Portsmouth Circuit Court order republished in Virginia's P.D. library.

Did the retailer avoid the penalty by arguing bidis were a different tobacco product? No. The court found bidis fit the statutory cigarette definition.

Citations and references

• Va. Code §§ 3.2-4200, 3.2-4207, and 3.2-4212.
• Va. Code § 58.1-1812.
• Circuit Court of the City of Portsmouth, Case No. 740CL12002011-00.

Source

• Landing page: Virginia Laws, Rules & Decisions
• Ruling: P.D. 14-16

Original ruling text

VIRGINIA:

IN THE CIRCUIT COURT OF THE CITY OF PORTSMOUTH

THE JUMA BROTHERS, INC. )

)

Plaintiff, )

)

v. ) Case No. 740CL12002011-00

)

VIRGINIA DEPARTMENT OF TAXATION, )

)

Defendant. )

ORDER

This matter comes before the Court on the Petition of Appeal filed by the Petitioner, the Juma Brothers, Inc. ("Juma Brothers"), the Answer filed by the Respondent, Virginia Department of Taxation (the Department), the parties' pretrial briefs, and the evidence and argument presented by the parties at the trial of this matter on June 12, 2013.

The Court is of the opinion that Juma Brothers has failed to meet its burden of establishing that the bidis in question were not required to be listed on the Virginia Tobacco Directory. The Court FINDS that bidis are cigarettes under the definition of cigarette found in Va. Code § 3.2-4200 and that the bidis in question are contraband cigarettes pursuant to Va. Code § 3.2-4207. The Court therefore HOLDS that the penalty assessed against Juma Brothers pursuant to Va. Code § 3.2-4212 is not erroneous. The Petition of Appeal is DENIED .

The Court further ORDERS that Juma Brothers remit to the Department the full amount of the assessment plus interest to be calculated pursuant to Va. Code § 58.1-1812, within 30 days from either (a) the date on which the time for filing an appeal expires with no appeal being filed, or, (b) in the event an appeal is filed, the date on which an order is entered which sets forth the final disposition of the appeal, whichever occurs first.

Nothing further remaining to be done herein, this matter is hereby ORDERED stricken from the docket.

The Clerk is requested to send certified copies of this order to counsel of record.

ENTER: July 15, 2013

Judge

I ASK FOR THIS: A copy, Teste: Cynthia P. Morrison

Clerk of the Circuit Court of the City of Portsmouth, Virginia

Elizabeth B. Myers (VSB #80739)

Assistant Attorney General

900 East Main Street

Richmond, Virginia 23219

804-786-9516 (telephone)

840-692-1647 (facsimile)

[email protected]

Counsel for the Defendant, Virginia Department of Taxation

SEEN AND OBJECTED TO FOR THE REASONS STATED ON THE RECORD:

Trey R. Kelleter, Esq. (VSB #41606)

Shalanda Franklin-Verdell, Esq. (VSB #76742)

Vandeventer Black LLP

101 W. Main Street, Suite 500

Norfolk, Virginia 23510

Counsel for Plaintiffs, The Juma Brothers, Inc.